NewsGator Client Apps Want to Be FREE!

Today we announced that NewsGator Inbox for Outlook, FeedDemon, NetNewsWire, NewsGator Go! for Blackberry, Windows Mobile and iPhone, and NewsGator Online are now available for free. That’s right, the license costs you zero, zip, nada.

But that’s not all, we have also released new versions of FeedDemon, NetNewsWire, and Go! mobile apps, and a public beta for Inbox 3.0. We are continuing to invest in these products and where we are taking them is a function of expanding their market reach.

I’ve been a NetNewsWire user for years (I was almost giddy the first time Brent Simmons sent me an email), like many I believe that this is without question the leading desktop RSS client application for the Mac. Windows users feel the same way about FeedDemon, it sets the high water mark for what an RSS application should deliver. NewsGator Online was one of the first web-based readers and it has a tremendously loyal customer base, Inbox defined the category for Outlook feed plugins and our Go! mobile apps are built for power users.

You should rest assured that this is not a move to take an end-of-life product line and get some additional mileage out of it, we will continue to invest in these applications and we will continue to lead the market.

We could have thrown a lot of money at marketing our client applications, signed up a bunch of distribution deals, and possibly done some kind of embedded OEM deal, but in the end the most expedient path to expanding the reach of these applications is removing the one barrier that exists that prevents people from downloading or signing up for them – economics. In effect, giving up the license revenue that we generate with these products is a form of marketing expense.

So if we are generating zero dollars of revenue from the client applications that we used to sell, well what is our business? Today we generate the bulk of our revenue from enterprise software, which is predominately server products but also includes these client applications (we call them “endpoints”). The fact remains that we actually generate a significant number of enterprise leads from people who are using our client apps and then realize they would benefit from enterprise management products. By that logic, more client applications in use is more enterprise goodness for us.

Okay, so we get all these client products out in the market, generate lots of enterprise software business, are loved by millions… surely that cannot be what this is all about? It isn’t.

The RSS market is maturing beyond supporting multiple feed definitions and doing extras like handling attachments. The three pane reader style is well established and features like setting read states and clipping and sharing have incremental value. Our users simply don’t say they need more content, they say that they want better content and we have been responding with an expanding portfolio of “attention” enhancements.

Better content means feed discovery based on preferences and behaviors, network search and relevance filtering, in effect achieving community-based collaboration and filtering on top of what the system can do off keywords and word association. You will be hearing more about this in the months ahead, we have a slew of partnerships and product updates in the works that will deliver best in class features to help you find feeds that are map to your interest areas, and individual content items that are relevant to the posts you are clipping and sharing.

Good relevance features depend on good behavioral data, in other words we will benefit from the surge of new users on our client applications in that we get a lot of data about subscription patterns and feed reading habits. We collect the subscription and behavioral data and anonymize it, then use it to improve the quality of our search results and relevance features in much the same way that search engines use search results to improve future searches.

Users can opt-out of the data collection mechanism and run standalone; we hope you don’t but we’re certainly not going to stop you from doing that or penalize you if you do. We have also rewritten our privacy policy, we wish to avoid any confusion or concern about what we are collecting and how we are using it, this policy is available for review at http://www.newsgator.com/privacy.aspx.

The new features we are building into our client applications and in our syndication services business (widgets) will take advantage of the behavioral data in a big way. Our partners who are using our APIs to access our content network will also have access to this data and our widget customers will be able to plug in network search for additional relevance features.

This is an exciting day for NewsGator and for me personally. When I joined the company I was motivated by the belief that the company had a clear vision for where RSS in the enterprise and consumer markets was going, this move not only highlights that vision but puts our money where our mouth is.

Here’s a FAQ that includes information not in the press release.

The Slippery Guvernator

This is similar to when companies say that they are reducing headcount by not hiring as many people as they planned to…

“To address next year’s $14 billion deficit, in two days I will submit a budget that is difficult,” he said. “It does not raise taxes. It cuts the increase in spending. And it cuts that spending across the board.”

[From Governor: It's time to "face our budget demons"]

RTM + Gmail = Goodness

Check out this Remember the Milk extension that lets you manage your tasks from within Gmail. I have been using RTM for several months now and it is the only task list app that I have been able to stick with (beyond post-it notes). I am super impressed with the speed by which they develop the service and add interesting new extensions, like this Gmail one.

It may seem trivial but apps like this are very difficult to develop and expand because the requirement isn’t solely on feature richness but absolute simplicity and usability while delivering the feature set that users deem as essential plus the extras that give them “wow” moments.

Hideshi Hamaguchi turned me on to a really cool term to describe this, simplexity.

Depends on the Meaning of “DRM”

When I first read that Sony was going to give up their DRM ways I was skeptical… after all this is the company that brought us a rootkit. After learning more about how their system works, well it makes perfect sense (for Sony, it doesn’t make sense for anyone else).

Kid #2: So to recap, what you’ve got here is a system that makes people leave their house in order to download music at their house, and makes them go to a store to get music that they could get at the store, somewhere else [From Why It Won’t Work]

This system will fail as all DRM systems have failed. Apple’s FairPlay has been the most successful in terms of market adoption, but it’s not difficult to strip out FairPlay from tracks you download from iTunes, in fact it is ridiculously easy. Apple was successful with FairPlay because their customers were getting something out of iTunes beyond music, they were getting convenience. It was a “truth between two parties” that as long as iTunes continued to give me easy access and hassle free downloading of reasonably priced music, well I’d put up with their DRM as long as it didn’t get in the way.

To support my argument that all DRM fails, I submit into evidence the fact that despite an abundance of DRM in commercial music for several years now there is no shortage of free downloadable illegal music. Of the 37 albums that Sony puts up on their “DRM free” scheme, I would bet that by the end of the day I could download all 37 albums and not pay one cent for any track. The vast majority of consumers will pay for their downloaded music if you give them a reasonably convenient mechanism for doing so.

As usual, Sony misses the boat on this concept and continues to insist that I come to them on their terms. This will fail and Sony will continue to fail in portable media players, online distribution, and customer satisfaction.